3. Identification of Risks
f. identify financial and non-financial sources of risk and describe how they may interact;
What are the three types of financial risks that originate from financial markets?
1. Market risk
2. Credit risk
3. Liquidity risk
What are the six types of non-financial risks that arise from actions within an entity or externally?
1. Settlement risk - one party fails to deliver the terms of a contract
2. Legal risk
3. Compliance risk (regulatory risk, accounting risk, tax risk)
4. Model risk - improperly using a model
5. Operational risk
6. Solvency risk